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Consolidating Consensus, Advancing People’s Struggles and Building Alternatives
Members of the Freedom from Debt Coalition and the Palag Na! People’s campaign staged protest in front of the Maynilad corporate office along Katipunan Avenue today to denounce the water company’s continued insistence on passing on its corporate income taxes its customers.
“Maynilad’s stubborn refusal to stop passing on its corporate income tax is a clear example of corporate greed. It has already been established that while it was charging Metro Manila water consumers for its income taxes, it was also benefiting from a tax holiday allowing it to bloat its profits further,” Sammy Gamboa, FDC Secretary-General said.
FDC demanded to know how Maynilad can continue to justify the passing on of its corporate income taxes to water consumers.
“Maynilad continues to hide behind its interpretation of the Concession Agreement which it claims allows the pass on of income taxes. However, the arbitration panel decision on the Manila Water case which disallowed the practice shows that the CA can also be interpreted in the opposite direction. But perhaps more important than the murky legal issues is the fundamental issue of justice and fairness—whether it is right for a corporation to make consumers pay for its income taxes,” Gamboa said.
“We are already paying taxes. If ordinary people like us are willing to shoulder this burden, what gives corporations like Maynilad, whose annual earnings run in the hundreds of millions, the right to avoid this responsibility? It is clear to all but the most naïve or the most callous that asking the people to pay for taxes owed by corporations is fundamentally unjust. It is pure and simple tax injustice, with big corporations passing its tax burden on the people, and government’s complicity through an unfair concession deal ” asserted Sammy Gamboa.
FDC called on the MWSS not to budge on its stance against the pass on of corporate income taxes by the water concessionaires. At the same time, FDC scored the government for entering into a patently lopsided and unjust Concession Agreements with water corporations that chase after their maximum profits to the detriment of water consumers.
“It is time we put our foot down on this kind of corporate abuse. We must plug the holes that have allowed the water concessionaires to make us pay for things like corporate advertisements, golf tournament sponsorships and corporate income taxes for years. The arbitration decision which stopped Manila Water from shifting the tax burden to unwitting water consumers, is only a partial and a shaky victory. The Manila Water aimed to recover their “income tax payments” and more, by demanding a refund by billions of pesos from the government through the provisions in the Concession Agreements that contain sovereign guarantees from the state for water concessionaires that should ensure their agreed upon rate of return of investments (ROI) , Gamboa added.
FDC warned that for as long as Metro Manila’s water systems remain privatized, and governed by unfair concession agreements, corporate profiteering and other abuses by water concessionaires will continue.
“Ultimately, the only way to ensure accountability is to review and eventually end these unjust Concession Agreements and put water back in public hands,” Gamboa argued.